On January 1, 2014, Allen Shoes acquired 60% of the stock of Danner Footwear. It is now December 31, 2017, four years since the acquisition. Allen uses the complete equity method to account for its investment in Danner. Danners assets and liabilities were reported at amounts approximating fair value, except for previously unreported indefinite life identifiable intangible assets valued at $20,000. These intangible assets were impaired by $5,000 during the years 2014-2016, and are impaired by $1,000 during 2017. The goodwill recognized for this acquisition was $62,500, split between Allen and the noncontrolling interest as 70% and 30% respectively. There has been no goodwill impairment during 2014-2016, but testing reveals goodwill impairment of $1,200 in 2017. Danner reported net income of $3,500 and Other Comprehensive Income of $100 for 2017. Required a. Calculate 2017 equity in net income and noncontrolling interest in net income.

Calculation of Equity in Net Income & oci Allen Item Total Danner Equity in Net Income Impact to Investment